Chairman of the Council of Economic Advisors Kevin Hassett stood at the White House briefing podium Monday slapping down theories that the rising American economy is a continuation of trends from the previous administration, illustrating an inflection at the time of President Donald Trump’s election.
Hassett displayed a chart showing small business optimism at a high not seen since July 1983. The chart showed a November 2016 jump in small business optimism that far outpaced a dotted line depicting the trend under the Obama administration.
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The next slide depicted the trend of small business investment from the Obama administration that was downward sloping and the sharp upward pivot in fourth quarter 2016. The slide noted that business investment is “up more than $300 billion over trend.”
“Capital goods orders and shipments up sharply,” read the next slide. Hassett stated that this measure is a “key” part of the economy. “It characterizes, basically, the good paying jobs,” he said. “The jobs that affect normal Americans, blue collar Americans.” Both charts displayed showed a strong pivot from a downward trend under Obama to an conversely upward trend at the time of Trump’s election.
“Business conditions have improved sharply,” read the next slide that displayed over five years of the ISM Purchasing Manager’s Index. Hassett explained that this is a survey of purchasing managers. The trend had been relatively flat on average, but began rising in November 2016. “There’s a clear inflection right at the election,” said Hassett.
“New business applications have surged,” read the next slide that plotted new applications that had been increasing, but began trending at a much faster pace after Trump’s election. “Prime-age workers are re-entering the labor force and finding jobs,” read the next slide that showed a rise outpacing the trend that appeared tied to the time of the November 2016 election.
Blue collar job growth hit 3.3 percent for the year through July, a rate not seen since 1984, according to the next slide displayed. The rise began again, came at the time of the November 2016 election.
Hassett then addressed the time considered for the measure of the trend. He then brought up Congressional Budget Office nonpartisan evaluation of “growth of private nonresidential fixed investment.” The last chart showed lines for CBO from June 2017 and April 2018. A third line on the chart depicted what actually happened and showed a greater increase that outpaced the CBO estimates starting in December 2017.
Hassert told reporters that he had been pushing to show the data for several weeks. He made the statement after a reporter asked during Monday’s White House briefing if the briefing was timed in response to public remarks from former President Barack Obama last Friday and Saturday that claimed the current economic prosperity was merely a continuation of trends that began under his tenure as president.